Beyond Dispute: Will Victoria's SOP Act Changes improve Payments?
- Michael Nixon
- Jun 22
- 2 min read
Thank you to the RICS MEG and in particular to Marc Allen for organising & moderating another successful event. This time in Partnership with Baker McKenzie and host Claire Newhouse.
The event consisted of 3 parts: an overview of the RICS Dispute Resolution Service from Patsi Michalson, a summary of the changes to the Security of Payment (SOP) Act in Victoria from Claire Newhouse, and a Q&A in which Patsi and Claire were joined by TSA Principal Will Dorsch.
In the context of the RICS Dispute Resolution Service presentation, it was inevitable that the discussion about changes to the Security of Payment (SOP) Act in Victoria would concentrate on the dispute process and the implications for dispute professionals. Lawyers, Delay Analysts and Quantum Experts.
Some reactions (and photographs) from the event can be found here
Jason Reading (MEG Chair) Post
Marc Allen (MEG Member and moderator) Post
James Dunphy Post
My takeaways / interest
However, my interest lies elsewhere. I'm interested to see the implications for the payment process. Specifically, will the changes lead to contractors being paid in full for work properly completed, without the need to go through the adjudication process?
In the limited time allotted for questions and in the company of so many Lawyers, Delay Analysts and Quantum Experts it was not the forum to raise the issue. And I could in any event anticipate the response. Not every contractor will be paid in full and as one of the lawyers present noted. They will find new technicalities. New defences to frustrate the intent of the legislation.
But I remain hopeful that the changes will be a good thing. Because, I remember when Security of Payment legislation was first introduced in the UK in 1996, following the Latham Report. I was fortunate to work as a Head and Subcontract Quantity Surveyor within the Llewellyn Group both before and after the introduction of the Housing Grants, Construction and Regeneration (HGCR) Act. The SOP legislation brought positive changes to the industry. While it wasn't a complete solution, it represented a significant improvement.
The legislation instilled a level of discipline in an industry that was previously lacking. The possibility of a progress claim being challenged and the concerns about bias favoring claimants compelled paying parties to enhance their practices and improve transparency. For example, practices mentioned in a recent post by Michelle Cirson—where a Quantity Surveyor (QS) or contract administrator (CA) would pay variations from retention—have largely disappeared.
I hope the new legislation encourages us to handle progress payments with increased care and precision. It should also accelerate the adoption of available tools to monitor quality, eliminate uncertainties from the process, and lead to improved financial and mental health outcomes.
Related Posts.
Tools for monitoring quality during construction [TBA]
Improved financial and mental health outcomes [TBA}
Disclaimer: This information is for general knowledge purposes only and should not be considered legal advice. It is essential to consult with a qualified legal professional for any legal matters or concerns.
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